Commentary: Sun has plan to shine again: "Sun is expected to announce as early as June that it will bundle more of its technologies together, including hardware, software and services, at a set price per user, per year, in an effort to boost sales and protect margins. A similar program that bundled infrastructure software has had some success at Sun's software division, formerly headed by Jonathan Schwartz, who was named Sun's president and chief operating officer last week. The move would generate more predicable stream of sales, which would go a long way toward doing away with quarterly sales warnings.

Sun is signing business at a profit in many divisions, even in low-end software where Sun is very price competitive with Linux. John Loiacono, formerly in charge of Sun's operating platforms, and the company's newly named head of software, says Sun is selling Unix-based software for $790 a year on an Intel-based server, a price that drops to $540 a year after the first year. In comparison, Red Hat Linux (RHAT) is sold with a service contract that costs $795 a year, he says. 'And I make money on those,' Loiacono says. 'Stay tuned. I'm going to get more aggressive on pricing.'

Sun is very focused right now on what its executives call low-hanging fruit. The company is spending marketing dollars only on specific projects where Sun has its best chance of success.

One near-term sales opportunity is an old, but refined message: Sun's hardware can make hosting mainframe applications cheaper. Companies like Austria-based steel manufacturer Boehler Edelstahl are choosing to host major applications such as its production planning system off of IBM zSeries mainframes and on to Unix-based Sun systems. Sun says such deals are proof that it's starting to see a payoff from mainframe rehosting software it bought from Critical Path in 2001 that's supposed to ease mainframe transitions to Sun systems.

Sun is also targeting sales to some telecom companies, formerly its bread and butter. Revenue is picking up in some areas, Loiacono says. Every time a cell phone company wants to add more features such as instant-messaging or a package of games, it has to write server-based software for it. Sun sells the Java-based infrastructure software that allows companies to more easily deliver such services over wireless networks."